This might be the future of wind repowering in the United States. In a first-of-its-kind project, the owner of a pioneering Illinois wind farm will bring down an aging fleet of 15-year-old turbines in a process akin to trees being logged in a forest.
The Mendota Hills site, in operation since 2003, was the first utility-scale wind farm in Illinois. The project owner, Dallas-based Leeward Renewable Energy, is replacing sixty-three 850-kilowatt Gamesa turbines with twenty-nine 2.6-megawatt turbines from Siemens Gamesa. The new project will increase power capacity at the site from just over 50 megawatts to 76 megawatts.
In an interview, CEO Greg Wolf told Greentech Media that Leeward is exploring repowering opportunities across its portfolio. Seventeen of the company’s 19 wind farms are beyond their 10-year Production Tax Credit (PTC) period. Mendota Hills is the oldest operating wind farm in its portfolio.
“Certainly, technology advancements and economics that come with those efficiency gains are a big part of the driving force,” he said.
The coming repowering wave
For wind project owners, the repowering decision is coming. As Greentech Media recently reported, North America’s fleet of aging turbines is prompting wind farm owners to consider whether to opt for partial (replacing blades, gearboxes or other components) or full-scale (complete teardown of existing turbines and installation of new equipment) repowering of their projects.
The National Renewable Energy Laboratory estimates that in the U.S. alone, annual repowering investments could reach $25 billion by 2030.
“The point we’re at now in the wind industry is, we have an old enough installed asset base to start looking at turbines that have reached their end of life,” Luke Lewandowski, research director at Wood Mackenzie Power & Renewables, said in an interview.
He added that it’s a much easier decision for owners if the original offtaker agreement has expired and the project is in a location with steady winds.
“The challenge with repowering is a lot of these older projects have very lucrative offtake agreements. As the cost of renewables has dropped over the last decade, folks don’t really want to disrupt those lucrative contracts to reinvest in a project,” said Lewandowski.
“Part of the trend...in repowering is that a lot of the initial sites were positioned to take advantage of strong winds," he added. "Obviously, they want to site the new turbines at the same spot, especially if the transmission can support it.”
Mendota Hills met both criteria. The original offtake agreement and 10-year PTC had expired. And the original project planners sited the wind farm in an area with some of the best wind resources in the state.
Leeward Renewable Energy worked with Siemens Gamesa to “safe-harbor” enough equipment, beginning in 2016, to ensure that the repowering project would qualify for a 100 percent 10-year PTC. Language in the December 2015 renewable energy tax extenders package stated that a project must commence construction by December 31, 2016 to qualify for the full PTC. Under IRS guidance, a wind project owner meets the safe-harbor requirement, and locks in the commence-construction date, by spending 5 percent or more of the total project cost.
A “Paul Bunyan” method to bring down the turbines
Deconstruction commenced at the Mendota Hills site this month. The teams working on the project refer to the process as the “Paul Bunyan” method.
First, all fluids are removed from the turbines. Next, the turbines are severed at the base and pulled down in a controlled fall via chains running from the top of the turbine hub to bulldozers on the ground. “It’s no different from, in a sense, cutting down a tree,” said Wolf.
With the turbine towers and blades on the ground, the existing foundations will be removed, and new foundations poured to accommodate the larger turbines to come.
Wolf said Leeward decided against the conventional turbine deconstruction method. In that approach, a crane is used in a top-down process that essentially reverses the initial erection of the turbine. This method is commonly used if the turbine is to be refurbished and sold on the secondary market.
According to Wolf, Leeward opted against resale of the original Mendota Hills turbines because of expected logistics and shipping costs. Instead, steel from the old turbines will be recycled. Leeward expects the Paul Bunyan method of teardown to be at least 25 percent cheaper than the conventional alternative.
The project timeline calls for construction, including upgrades at the substation interconnection and erection of new turbines, to be completed and for the new wind farm to be feeding into the grid by the end of 2018.
New equipment improves project economics
Leeward is unable to disclose the terms of the new power-purchase agreement signed with offtaker Digital Realty, a data center operator. But according to Wolf, "It’s consistent with most other C&I marketplace procurements you’ll see today."
Leeward Renewable Energy hopes to reduce per-megawatt-hour costs by 30 percent to 50 percent at the repowered Mendota Hills project. When asked if Leeward will still hit that mark, Wolf said the outlook is positive. “The site will be within that range, and we think at the upper end of that range," he said.
Going from a 52-meter rotor and 2003 technology to a 126-meter rotor and 2018 technology will significantly improve the economics of the project, said Wolf. “We expect the efficiency of that, and therefore the operating cost per megawatt-hour, to give us a very important uplift for this site to be competitive in today’s market.”